Red Chilli Prices to Rise on Festival Demand, Weak Rains
The prices of red chilli, India’s most exported single spice, are expected to rise again due to higher festive demand and weak rains in the coming weeks.
The average prices of red chilli have fallen from ₹250 per kg to around ₹230 per kg in recent weeks due to subdued export demand and accumulation of sufficient inventory to last till the arrival of the new crop by next January.
However, the prices are expected to rise again in the coming weeks due to the following factors:
- Higher festive demand: The Dussehra festival season, which begins in October, is a major demand driver for red chilli.
- Weak rains: The late setting in of the southwest monsoon and weak rains in the coming weeks could delay the arrival of the new crop by a month.
- Pest infestation: Chilli crops are also vulnerable to pests such as black thrips, which could damage the crop and lead to higher prices.
The chilli crop is expected to be the same or slightly less than the previous season. However, a clear picture will emerge only by October as there is still time to transplant chilli from the nurseries to the fields.
The chilli industry is worth around ₹10,000 crore in India. The country is the world’s second-largest producer of red chilli after China.
The rising prices of red chilli could impact the prices of other food items, such as curries and pickles. It could also put pressure on the inflation rate.
The government is monitoring the situation and is taking steps to ensure that the prices of red chilli remain stable. These measures include increasing imports and providing financial assistance to farmers.
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